Contractionary monetary policy is solely aimed at reducing inflation without any impact on unemployment levels.

Contractionary monetary policy is a strategy used by central banks to reduce inflation, which is the rate at which prices for goods and services rise. This policy typically involves increasing interest rates, making borrowing more expensive and saving more attractive. While the primary goal is to control inflation, it can also have an impact on unemployment levels, as higher interest rates may lead businesses to cut back on spending and hiring. For example, if a company decides to delay a new project because loans are more costly, this could result in fewer job openings. Therefore, while the focus is on reducing inflation, it can also unintentionally affect employment rates.